Sprint poised to pay Clearwire up to $1.6 billion, preventing it from a fallout

Sprint will be doling out up to $1.6 billion to Clearwire during the next four years, solving the cash crunch of its WiMAX supplier. Thus Clearwire will be able to meet its $237 million interest payment due today, said the company.

Things were looking dreary in November, when Clear announced it will miss the payment, potentially facing penalties from creditors and spiking borrowing costs afterwards. The company needs the money just to operate, but it also has to go ahead with its network upgrade plans.

Sprint, which is a majority owner, and Clearwire's biggest customer at the same time, looks to expand its stake and the current network agreement against its money. If Clearwire goes to the markets for additional $400-$700 million, Sprint will be a part of it as well, up to its $347 million right, based on the stake it holds.

The carrier will also give Clearwire $926 million for network usage in the next two years, and Clear will support it until 2015, when the last contract of Sprint's WiMAX phones will expire. Moreover, Sprint will pay up to $350 million over two years for LTE from Clear, if build-out milestones are met by June 2013. The companies plan to introduce the first data cards and smartphones with LTE connectivity in 2013.

All I can do is smh @ Sprint they are doing their best to stay competitive and profitable. My only query is why invest in wimax, invest in clearwire, and then decide to go LTE when wimax 2 is an available technology and it doesnt hurt your business relationship with clearwire.

I believe Sprint will do launch their LTE network late Q1 or Q2. And they will expand it more aggressively than how they expanded WiMax.. they are planning to switch to LTE in the first place thats why they didnt bother expanding their WiMax network anymore.. i know Sprint sucks but believe it or not, they have their word.

Yeah, when I moved into my place a didn't realize that when the landlord renovated he didn't include and phone or cable jacks on the wall. Maybe the contractors he used were horrible and just dry walled right over the outlets. I don't know. But that's something I just took for granted as being included and didn't even look for. Clearwire was there to save the day though by just being able to plug into a wall.

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